Sorry if this has been answered previously but trying to get my thought process in place on these new rules and how it all works accounting wise in the PSC itself.
So I know from the guidance the PAYE and NI deducted by the end company and thus not remitted to the PSC is taken as a debit to sales. I note there is an argument it could be wages or bad debt, but in essence it is a debit to P & L whatever.
So my client who invoices £2250 plus VAT (and assuming a 30% deduction) would get back £1575 plus £450 = £2025. The VAT gets paid leaving £1575 in the pot.
I note the client can pay a net salary of £1575 to the director and not incur any additional PAYE / NI as this is deemed cover by the end company.
If it does then the Dr would be to Wages and the PCTCT would be £1575 - £1575 = Nil
However the guidance says the company could also pay a "dividend" to the director of £1575. This wouldn't need to declared on the SA return but ordinarily a dividend would not be a CT deduction.
What happens if you chose to leave the money in the company and only pay a percentage out as salary or dividend.
I saw a previous answer that suggested that you Dr Wages Cr Directors loan account with the net salary however the guidance to me infers that you get a "deemed deduction" from the PCTCT equivalent to the net salary irrespective of what you do next with the net due.
Finally thought, what if you paid the net as an employer pension contribution. Could you in theory get a deemed deduction for the net salary and then a second deduction for the pension contribution. In my case this is a husband and wife company and the wife is doing contracts non public sector and non IR35, so there will be PCTCT from her source income. I can't believe the legislation would permit this double dip